Burger v. City of Beatrice

• Decision Date: 06 January 1967
• Docket Number: No. 36292,36292
• Citation: 181 Neb. 213,147 N.W.2d 784
• Parties: Fred J. BURGER et al., Appellants, v. CITY OF BEATRICE, Nebraska, a Municipal Corporation et al., Appellees.
• Court: Nebraska Supreme Court

Page 784

147 N.W.2d 784

181 Neb. 213

Fred J. BURGER et al., Appellants, v. CITY OF BEATRICE, Nebraska, a Municipal Corporation et al., Appellees.

No. 36292.

Supreme Court of Nebraska.

Jan. 6, 1967.

Syllabus by the Court

1. An injunction is a proper action in which to present the question of unlawful or improper exercise of the power of eminent domain.

2. The Constitution of Nebraska and legislative acts pursuant thereto are in no sense a grant of power, but are limitations of the power of eminent domain. The Legislature may limit the sovereign power of eminent domain, but it lacks the power to extend it.

3. A use under the power of eminent domain must be a public use, and whether or not a use is public or private is a judicial question and not a legislative one.

4. A city in engaging in the production and distribution of water for the benefit of its inhabitants is engaged in a proprietary capacity rather than a governmental one. When engaging in an ordinary business enterprise, a city is bound by all the rules of substantive law and procedure applicable to any other private corporation or person engaged in a like enterprise.

5. When the city engages in a public utility business, it must provide water service to all inhabitants alike who desire it at the same rate for the same service.

6. The production and distribution of water for the inhabitants of a city is for a public purpose within the meaning of the power of eminent domain.

7. The power of a city of the first class to contract for the sale of water outside the city's corporate limits, as provided by section 19--2701, R.R.S.1943, is contractual and permissive and in no sense mandatory or the result of a duty imposed by legislative action or otherwise.

8. Under the provisions of Article I, section 25, Constitution of Nebraska, every citizen has a right to the acquisition, ownership, possession, enjoyment, or descent of property.

9. The private property of a citizen may be taken from him by the sovereign power of eminent domain only when it is taken for a public purpose. It cannot be taken for a private use.

10. Contracts for the sale of water outside the corporate limits of a city, as authorized by legislative enactment, are contractual and not for a municipal public purpose.

11. The sale of water by a city outside its corporate limits to a private person, corporation, or industry for his or its own private purpose is not a public use within the meaning of the doctrine of eminent domain.

12. The character of the use, and not its extent, determines the question of public use. Where there is simply a public interest as distinguished from a public use, the power of eminent domain cannot be exercised. In determining whether or not the exercise of the power of eminent domain exists under the evidence, the courts look to the substance rather than to the form, to the end rather than to the means.

13. When the purposes for the taking of private property by the exercise of the power of eminent domain are in part public and part private, and the two are not severable, the right to proceed by condemnation must be denied.

14. When the private and public purposes in a condemnation proceeding are severable, the court may proceed as to the public purpose and deny the right to condemn as to the private purpose.

Asa A. Christensen, Clayton K. Yeutter, Lincoln, for appellants.

Anne P. Carstens, Beatrice, Perry, Perry, Sweet & Witthoff, Lincoln, for appellees.

Stewart, Calkins & Duxbury, David L. Crawford, Lincoln, amici curiae.

Heard before WHITE, C.J., CARTER, SPENCER, BOSLAUGH, SMITH, and McCOWN, JJ., and BOYLES, District Judge.

CARTER, Justice.

Plaintiff landowners brought this action to enjoin the City of Beatrice from proceeding in eminent domain to take restrictive easements over their lands for the installation of water wells and the withdrawal of ground water from beneath the surface of their lands. The trial court denied an injunction and the plaintiff landowners have appealed.

The evidence shows that in the fall of 1964, the City of Beatrice maintained a water distribution system for the inhabitants of the city. It operated 4 water wells in a well field 6 or 7 miles northwest of the city in an area near the Big Blue River. These wells, referred to in the record as wells Nos. 1, 2, 3, and 4, are located on the right-of-way of the Chicago, Burlington & Quincy Railroad, running in a northwest-southeast direction. The railroad right-of-way crossed the lands of plaintiffs. The wells were spaced 1,100 feet apart and were manned with pumps and two 14-inch pipelines which transported the water to the city of Beatrice. The wells and water mains had the capacity to produce and deliver 6,000,000 gallons of water per day to the city. It was determined by the city prior to the events instigating this litigation that the maximum water needs of the city were inadequate even though the city was able to provide the water needs of the city and its inhabitants in 1964.

In 1964 and following, the Phillips Petroleum Company and the Cominco Products Company established fertilizer plants approximately 6 miles northwest of Beatrice near the unincorporated village of Hoag and near the water mains located between the city of Beatrice and its existing well field. Hoag is less than 1 mile southeast of the well field. On February 3, 1965, Phillips entered into a contract for the purchase of water from the city for the use of the new plant. This contract provided for the delivery of an estimated average of 50,000,000 gallons of water per month with a maximum of 90,000,000 gallons per month. At the time of trial, a similar contract with Cominco was near completion. The negotiations indicated that Cominco required an average usage of 35,000,000 gallons of water per month with a maximum of 90,000,000 gallons per month.

With the foregoing situation existing, the city determined that a need existed for the extension of its well field by 4 wells. On March 19, 1965, the city entered into a contract with the Chicago, Burlington & Quincy Railroad by which it obtained an easement to install new wells on the railroad right-of-way. The final plan of the city was to extend its existing line of wells to the northwest with 1,100-foot spacing from well 4, the farthest northwest well of the existing wells. The plan required the easements here sought to permit the withdrawal of water by the pumps installed from the ground waters underlying plaintiffs' lands. To obtain these easements, the city negotiated with the plaintiffs and, failing this, the city instituted the condemnation proceeding here involved on April 8, 1965. On April 22, 1965, this action was commenced to enjoin the condemnation proceedings for the reasons hereinafter discussed.

The evidence shows that Phillips and Cominco are private corporations engaged in the production of commercial fertilizers for profit. It also shows that the water requirements of these two companies will equal or exceed the previous requirements of the city of Beatrice. On the foregoing facts it is urged that the condemnation proceeding is for a private purpose and not a public purpose as required by the law of eminent domain.

It is first urged by the city that injunction is not a proper remedy for the reason that plaintiffs have an adequate remedy at law. The rule is: This court is committed to the rule that injunction is a proper action in which to present the question of unlawful or improper exercise of the power of eminent domain. Consumers Public Power Dist. v. Eldred, 146 Neb. 926, 22 N.W.2d 188; Heppe v. State, 162 Neb. 403, 76 N.W.2d 255.

The power of eminent domain is a sovereign power which exists independent of the Constitution of Nebraska. The Constitution of Nebraska and legislative enactments pursuant thereto are in no sense a grant of power, but are and should be treated as a limitation of the power of eminent domain. Consumers Public Power Dist. v. Eldred, supra. The Legislature may limit the sovereign power of eminent domain but it lacks the power to extend it. The absolute power of the sovereign authority to take private property for a public use has been limited by the Constitution of Nebraska by subjecting the taking to the payment of compensation for the land taken and the damages to property not taken. Art. I, s. 21, Constitution of Nebraska. But it is essential that a use under the power of eminent domain must be a public use, and whether or not the use is public or private is a judicial question and not a legislative one.

A city in engaging in the production and distribution of water for the benefit of its inhabitants is engaged in a proprietary capacity rather than a governmental one. The distinction between its governmental status and its proprietary capacity have been made in the past by this court. In Henry v. City of Lincoln, 93 Neb. 331, 140 N.W. 664, 50 L.R.A.,N.S., 174, this court in dealing with the nature of the city's proprietary capacity said: 'It is no part of its duty, as a municipal corporation, to engage in a purely business or commercial enterprise. When it seeks and obtains from the Legislature permission to engage in such an enterprise, its act in so doing is purely voluntary on its part, and it thereby assumes a third relation, separate and distinct from the dual relations above considered. While occupying this third relation, no governmental functions or corporate duties, as a municipality, devolve upon it. It is then engaged in an ordinary business enterprise, and is bound by all the rules of law and procedure applicable to any other private corporation or person engaged in a like enterprise. It has no greater or higher privileges or immunities than are possessed by any other private corporation.' See, also, Incorporated Town of Sibley v. Ocheyedan Electric Co., 194 Iowa 950, 187 N.W. 560.

When it assumes the status of a private utility company in the production and distribution of...